"Midea", the world's leading air-conditioner brand, announces its business direction in Thailand. Proactively tapping into the country's commercial air-conditioner market, it seeks to expand its B2B distribution channels and promote its energy-saving "Magnetic Centrifugal Chiller" technology. For its branding, Midea will allocate 12 per cent of its sales revenue for marketing purposes in hopes of boosting sales by 45 per cent and raising its market share. Its ultimate goal is to become Thailand's No. 3 Commercial Air-conditioner brand in five years. Midea's opening of its air-conditioner factory in Thailand, which is the biggest in Asia, underlines its confidence in the country. Aiming to use Thailand as its export hub for ASEAN market, the firm believes its business will grow across the region.
Mr. Tony Liu, General Manager of MD Consumer Appliance (Thailand) Company Limited or Midea Thailand, reveals that his firm aims to drive the sales growth of its commercial air conditioners by expanding B2B customer base. Target groups are customers who need commercial air-conditioning building systems such as property developers managing hotels, villas, condominium buildings, houses, etc. This sector looks set to grow in line with Thailand's rebounding tourism and its government's reopening policy. Not only that Midea Thailand will increase the size of its team for the segment to accommodate growing number of customers, but it will also develop a diverse range of products to fulfill every need of customers to ensure Midea is a top-of-mind brand among Thais and the new generation.
Midea Thailand plans to spend 12 per cent of its sales revenue on marketing and branding in support of its marketing and sales teams. A strong emphasis will be placed on distribution channels, product-usage training for property projects, and after-sales services that are the core parts of its business. The firm aims to achieve 45-per-cent sales growth this year and raise its market share further on a continued basis. In 2022, it will expand its workforce for its plan for customer-base expansion. Setting its sight on developing a strong network of business partners, it will import elevators too. All these moves are designed to pave way for Midea MBT to become No. 3 brand in Thailand's commercial air treatment product segment that involves VRF, Chiller, and Light commercial AC within five years.
On marketing strategy, Midea Thailand plans to position itself as a brand for the new generation. Midea Thailand's products truly answer well to young-generation people's needs. Moreover, it will continue to develop its products further in terms of technologies and innovations so as to best respond to the young generation. Included in its product portfolio are IOT (Internet of Things) devices that enables homeowners to control their home with great convenience. Impressive after-sales services will also raise Midea Thailand's competitive advantages.
On technologies, Midea Thailand boasts solid strengths in commercial air conditioners. Its diverse range of products, moreover, promises to solve all the pain points of individual or corporate customers. Presently, Midea products can cover all sizes of space. There are two types of air conditioners: MBT, commercial air conditioning technology (for commercial air-conditioner, usually for B2B usage) and Residential air conditioning or RAC (for small aircon devises, usually for B2C usage) Midea MBT products are highlighted as 1) VRF and 2) Magnetic Centrifugal Chiller that offers high cooling efficiency, a longer use life, and a lower cost of ownership. Using Back-To-Back compressor, such device has greater stability too. Importantly, as these chillers are developed and manufactured by Midea itself, they have cost advantages both as products and parts. Moreover, they integrate Full Falling Film Evaporation technology. When compared with other chillers, Midea's Magnetic Centrifugal Chiller saves energy and refrigerants by 40 per cent.
Midea Thailand is a subsidiary of "Midea Group". Established more than 53 years ago, Midea Group is a world-class tech firm. In 2021, it ranked 288th on Global Fortune 500. Currently, it is the world's No. 1 air-conditioner brand too. Its product portfolio is diverse, as it answers to the needs of enterprises, individual customers as well as families. Its product range, for example, covers commercial / residential air conditioners, chillers, washing machines, small / large electrical cooking appliances, and other devices related to water, floor cleaning, and lighting.
Midea Group's air conditioners can also be categorized into two categories: MBT for commercial users and RAC for housing units. Founded in 1999, MBT Group has conducted R&D for the development and manufacturing of commercial air conditioners. It has invested more than 100 million US dollar in robotic and automation technologies. Its investment budget on this part has also risen by five per cent every year. MBT Group has six factories and distribution centers in various countries including China and Italy. Its R&D team has hired more than 600 employees.
Mr. Liu says because his firm has confidence in Thailand, it has set up Midea Thailand Smart Factory for the production of residential air conditioners in the country. Located in Pinthong 5 Industrial Estate in Chon Buri's Sri Racha district, this factory started its operation in the first quarter of this year. Not only that it is Midea Group's biggest manufacturing facility for residential air conditioner in Asia, but it is also the group's largest factory outside China in terms of manufacturing capacity. Midea Group aims to use this factory as its manufacturing base for export to ASEAN market. The move promises to boost its operations in ASEAN through enhanced competitiveness and tax privileges. In addition, Midea Group's role here will enable ASEAN nations to benefit from the full supply chain.
As for Thai market, the opening of MBT Group's factory here will play a big role in quickly boosting Midea image and market share. Midea Group has paid special attention to Thailand, which accounts for 47 per cent of its ASEAN market. In its view, Thailand has solid potential for further sales and profit growth. Moreover, the country is a key player in the supply chain as a major manufacturer of key parts like compressors, motors, and PCB boxes. Thailand also boasts efficient logistics and comprehensive distribution platforms for Midea Group's MBT & HVAC businesses as well as strong distribution channels for individual customers in the forms of department stores and provincial distributors.
"Thailand ranks high in ASEAN on economic freedom and growth indexes. The country is truly ASEAN's economic hub. Our business in Thailand smoothly connects Midea with relevant supply chain, thus enabling smoother and faster operations. In addition, we have now enjoyed opportunities to expand our customer base via the new generation and e-commerce that had achieved very high sales records in the past year," Mr. Liu concluded.